Industrial relations: there may be trouble ahead

With job losses mounting, there’s every likelihood workplace disputes will escalate in the coming months. So it’s imperative that employers are fully aware of the law covering such issues.

Scholars of modern history will have noted two recent anniversaries marking significant low points in UK industrial relations.

First, the season just passed was the 30th anniversary of the ‘Winter of Discontent’, where between November 1978 and February 1979, disagreements over pay led to widespread strikes, electricity cuts, uncollected refuse and the dead unburied. It signalled the end of the Callaghan government.

And only last month, a number of marches took place around the country to commemorate the 25th anniversary of the start of the Miners’ Strike.

These milestones will certainly not have been lost on many of today’s commentators who, while not predicting a return to the extreme clashes of the Thatcher years, have voiced concerns that the economic downturn may spawn industrial action in one form or another.

Already this year we have seen wildcat strikes by energy workers across the UK in support of employees at the Lindsey oil refinery in Lincolnshire, who walked out in protest over the use of foreign workers.

A fortnight later, union fury was targeted at car manufacturer BMW for sacking 850 agency staff at its Mini plant in Cowley near Oxford, while last month members of the UK’s biggest rail union – the RMT – at two major commuter train-operating companies voted overwhelmingly for strike action to defend jobs.

Left-of-centre newspaper the Guardian has gone as far as to report the UK could face a ‘summer of rage’ as concerns over job losses and financial security mount.

However, experts are divided on the notion that this is only the tip of the proverbial iceberg and that 2009 will be remembered for an explosion in industrial strife.

At Newcastle Business School, Nick Creaby-Attwood, lecturer in HR management, agrees the economic conditions are “creating an underlying environment for conflict”, but also feels in many cases fears about job security will override any compulsion to take industrial action.

“People are generally prepared to make all sorts of compromises to keep their job,” he says.

Andy Cook, managing director of employee relations consultancy Marshall James, agrees that “employers have the job security argument on their side”. He also points out that one key difference between now and 1979, which makes a repeat of industrial action on that scale unlikely, is that today there are far fewer workers who belong to unions. Thirty years ago, the total hovered around 13 million. Today, union membership is around half that figure, with only 25% of the workforce signed up.

At the TUC, the head of the organisations and services department, Tom Wilson, says rather than looking for conflict, many unions are in the business of going through “difficult negotiations” in a bid to save jobs.

He points to agreements in the automotive industry to move to four-day weeks or suspend production for a period as signs that unions have responded to government attempts to stave off job losses.

Real concern
But lawyers involved in the industrial relations arena paint a different picture. Nick Thomas, a senior associate at law firm Jones Day, says there is “a real concern” among employers – particularly in the industrial manufacturing sector – that there will be industrial action this summer.

Marc Meryon, a partner at law firm Bircham Dyson Bell, mostly represents employers in the transport sector. He says he is handling far more cases where strike ballots are being proposed than he was a year ago. “Things have escalated significantly,” he says.

When it comes to the law in this area, Thomas describes it as “horrendously complicated”, but says there are a few basic principles employers need to be aware of.

Official or unofficial?
Industrial action, whether it be a strike, or an overtime or call-out ban, can fall into several categories. The first distinction is whether it is official or unofficial. If the action has been endorsed by a union, it is generally considered official. If it has not been called by a union or has been disowned by a union, it is unofficial.

The second important distinction, according to Thomas, is whether the action is protected or unprotected. Action is deemed protected if it takes place after a legally proper ballot of the workforce. If there is no ballot or the ballot has not been handled properly, any action will be considered unprotected. There is stringent legislation around what constitutes a proper ballot – all detailed in the Trade Union and Labour Relations (consolidation) Act 1992.

He says: “To qualify as a proper ballot, union officials will have had to have informed employers that a ballot was taking place, given notice of results and informed them of when and what action is to take place.”

So-called wildcat strikes are usually industrial action that is both unofficial and unprotected. In this instance, Thomas says, legally, employers have “quite a free hand”, and can sack all participants in the action – all of whom have no right to bring a claim for unfair dismissal in this instance.

If the action is official but unprotected, Thomas says employers still have rights to dismiss participants, but must treat all employees taking the action in the same way.

If the action is official and protected, the employer is not entitled to dismiss participants and any attempt to do so will automatically be seen as unfair dismissal.

Thomas says employers are under no obligation to pay for lost working hours during a strike as employees are not performing the work they are contracted to do. “But whether an employer decides to hold back pay or not may depend on what they are hoping to achieve.”

The importance of keeping communication lines open with union representatives is picked up by Meryon, who says employers have the right to request an injunction on industrial action if a ballot is not carried out properly.

Should, for example, the union omit to inform the employer which category of worker is to be included in the ballot, or if the wrong wording is used on the ballot slip, then the employer can write to the union and demand it halt any potential action until the ballot process is carried out properly. “Once there is an injunction, it forces the parties to talk, and often you find a situation can be resolved during this time,” says Meryon.

As far as picket lines go, anyone not crossing the picket line is legally considered to be on strike, says Meryon. If individuals are being intimidated by unions or work colleagues, employers have recourse to workplace harassment laws. If public order offences are being committed, then this is a criminal issue and a matter for the police.

He says employers can reward staff who work through strikes with bonuses. Likewise, they can remove overtime opportunities and bonuses from those taking action. But he counsels against such action in most cases. “Such moves can strain relationships with unions and workers. And at the end of the day, when the action is over, everyone will have to get along.”

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How employers can improve industrial relations

A former HR director at Transport for London as well as a union representative in his time, Andy Cook set up industrial relations consultancy Marshall James after identifying a lack of companies offering advice for employers in this area.

He says there are a number of disciplines employers fall down on when it comes to striving to maintain good industrial relations.

“Employers should work tirelessly at engaging with employees, especially around informing them what the organisation is trying to achieve and what it will take to get there,” he says. “In a lot of cases, they leave the unions to do the talking with employees.”

And employers should not be afraid to continue this dialogue even when what they have got to say might not be what employees want to hear.

“Don’t be frightened to tell them bad news – you must be upfront about everything. It’s more demotivating to give no news at all.”

Cook also bemoans the lack of information-sharing among employers in the UK.

He says: “We don’t want a return to national pay bargaining or organisations giving away competitive secrets. But employers would be in a stronger position if they shared information about their workers’ pay and conditions with their competitors, so they know what’s going on across their industry.

“At the moment, a lot of companies are being picked off by unions because they can leverage this information much more easily.”

And with industrial action on the rise, Cook believes it is time organisations started training their people in how to better manage industrial relations.

He adds: “There’s a real shortage of people with experience of dealing with unions. For a long time, organisations haven’t needed people dedicated to industrial relations and have turned their attention to areas such as organisational development instead.”

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